|Code of Business Conduct and Corporate Governance|
PURPOSE AND SCOPE
This Code applies to the Company, all of our subsidiaries, and all other business entities that we control worldwide. We expect all our directors, officers and employees to comply at all times with the principles of this Code. A violation of this Code by an employee, officer or director is grounds for disciplinary action up to and including discharge and possible legal prosecution.
Protection of Corporate Assets and Opportunities.
Employees, officers and directors should seek to protect the Company's assets, including proprietary information and intellectual capital. Theft, carelessness and waste have a direct impact on the Company's financial performance. Employees, officers and directors must use the Company's assets and services (including the services of Company employees) solely for legitimate business purposes of the Company and not for any personal benefit or the personal benefit of anyone else.
Employees, officers and directors owe a duty to the Company to advance our legitimate business interests when the opportunity to do so arises. Employees, officers and directors are prohibited from taking for themselves (or directing to a third party) a business opportunity that is discovered through the use of corporate property, information or position, unless the Company has already been offered the opportunity and an appropriate member of senior management or a director has declined the opportunity on behalf of the Company, in writing.
Sometimes the line between a benefit to the employee, officer or director and a benefit to the Company is difficult to draw, and sometimes overlapping benefits may be derived from certain activities. The only prudent course of conduct is to make sure that an appropriate member of senior management or, if you are an executive officer or director, the Chairman of the Audit Committee approves beforehand any use of Company property or services that is not solely for the benefit of the Company.
Improper Influences - Gifts and Entertainment.
The use of Company funds or assets for gifts, gratuities or other favors to government officials is prohibited, except to the extent such gifts, gratuities or other favors are in compliance with applicable law, insignificant in amount and not given in consideration or expectation of any action by the recipient. Employees, officers and directors must not offer, make, solicit or receive a bribe, kickback, illegal political contribution or other improper payment anywhere in the world, and we do not condone any such activity on the part of our employees, officers or directors. Bribes and kickbacks are criminal acts, strictly prohibited by law. The Foreign Corrupt Practices Act prohibits giving anything of value, directly or indirectly, to officials of foreign governments or foreign political candidates in order to obtain or retain business.
No employee, officer or director shall use Company funds or assets for gifts to any organization or individual that has, or is seeking to have, a business relationship with the Company, except to the extent such gifts are less than or equal to $150 in value and are in compliance with applicable law.
No employee, officer or director should accept, or permit any member of his or her immediate family to accept, from any organization or individual that has, or is seeking to have, a business relationship with the Company, any gift or gratuity of material value. Any gifts that are in excess of $150 in value should be returned immediately and reported to your supervisor or the Company's Chief Compliance Officer, or if you are an executive officer or director, to the Chairman of the Audit Committee. If immediate return is not practical, they should be given to the Company for charitable disposition or such other disposition as the Company, in its sole discretion, believes appropriate.
Employees, officers and directors should provide, or accept, business entertainment to or from anyone doing business with the Company only if the entertainment is infrequent, modest, intended to serve legitimate business goals and in compliance with applicable law.
In applying these guidelines, employees, officers and directors must use common sense and good judgment to avoid the appearance of impropriety.
We encourage our employees, officers and directors to be active in industry and civic associations. However, any employee or officer so desiring to serve on boards of directors or advisory boards of any entity or organization must obtain the prior written approval of our Chief Executive Officer and the Chairman of the Board of Directors or, if you are an executive officer, the Chairman of the Board of Directors. Any director desiring to serve on the board of directors or advisory board of any entity or organization must report such activity to the Chairman of the Board of Directors.
CONFIDENTIAL AND PROPRIETARY INFORMATION
The protection of confidential and proprietary information is vital to the Company's success. No employee, officer or director should reveal or divulge any confidential and proprietary information entrusted to him or her by the Company or other companies, including our suppliers and customers, unless required to do so in the ordinary process of carrying out day-to-day responsibilities and then only with the knowledge and approval of the appropriate member of senior management, or unless legally mandated. Confidential and proprietary information includes, among other things, any non-public information concerning the Company, including our businesses, products, financial performance, results or prospects, and any non-public information provided by a third party with the expectation that the information will be kept confidential and used solely for the business purpose for which it was conveyed.
Each employee is required to sign a Confidentiality and Non-Disclosure Agreement, promising that he or she will not divulge confidential or proprietary information or material outside of the Company; in addition, it acknowledges that the ideas, inventions, products and processes developed while working for us are the Company's sole property.
SPECIAL ETHICS OBLIGATIONS FOR EMPLOYEES WITH FINANCIAL REPORTING RESPONSIBILITIES
As a public company, it is of critical importance that MRV's filings with the Securities and Exchange Commission be accurate and timely. Depending on their position with MRV, employees may be called upon to provide information to assure that our public reports are complete, fair and understandable. We expect all of our personnel to take this responsibility very seriously and to provide prompt and accurate answers to inquires related to our public disclosure requirements. Our Finance Department bears a special responsibility for promoting integrity throughout the organization, with responsibilities to stakeholders both inside and outside of MRV. Our Chief Executive Officer and Finance Department personnel have a special role both to adhere to these principles themselves and also to ensure that a culture exists throughout the Company as a whole that ensures fair and timely reporting of MRV's financial results and condition.
Because of this special role, the Chief Executive Officer and all members of our Finance Department are bound by the following Financial Officer Code of Ethics, and by accepting this Code, each agrees that he or she will:
PUBLIC COMMUNICATIONS AND REGULATION FD
The Company will adopt a detailed policy on Regulation FD, which may be obtained from the Company's Chief Financial Officer.
REPORTING AND COMPLIANCE PROCEDURES
The economy of the United States, and of most nations in which we do business, is based on the principle of a free competitive market. To ensure that this principle is played out in the marketplace, most countries have laws prohibiting certain business practices that could inhibit effective competition. The anti-trust laws are broad and far-reaching. They touch upon and affect virtually all aspect of our operations. We fully embrace all anti-trust laws and avoid conduct that may even give the appearance of being questionable under those laws. Each employee should keep those thoughts in mind when going about his or her job, because the penalties for violations can be quite serious, both to MRV and to the individual. Whether termed anti-trust, competition, or free trade laws, the rules are designed to keep the marketplace thriving and competitive.
Any employee, officer or director having material, non-public information relating to MRV or our business, or any such person's family members, or any entities controlled by such persons or their family members, may not buy or sell securities of MRV or engage in any other action to take advantage of, or pass on to others, that information. This policy also applies to trading in the securities of any other company, including our customers, suppliers, vendors or other business partners, if an employee, officer or director has material, non-public information about that company obtained by virtue of his or her position at MRV.
Transactions that may be necessary and justifiable for independent reasons, including emergency expenditures and transactions planned before the employee learned the material information, are not exceptions. Even the appearance of an improper transaction must be avoided to prevent any potential prosecution of MRV or the individual trader.
Besides the obligation to refrain from trading while in possession of material, non-public information, employees, officers and directors are also prohibited from "tipping" others. The concept of unlawful tipping includes passing on information to friends or family members under circumstances that suggest that employees were trying to help them make a profit or avoid a loss. Besides being considered a form of insider trading, or course, tipping is also a serious breach of corporate confidentiality. More detailed rules governing the trading of MRV securities by employees, officers and directors are set forth in MRV's Statement of Policy to Directors, Officers and Employees Concerning Securities Trading.
FOREIGN CORRUPT PRACTICES ACT
We require full compliance with the Foreign Corrupt Practices Act ("FCPA") by all of our employees, consultants, agents, distributors and resellers. The anti-bribery and corrupt payment provisions of the FCPA make illegal any corrupt offer, payment, promise to pay or authorization to pay any money, gift or anything of value to any foreign official, or any foreign political party, candidate or official, for the purpose of:
All MRV employees, whether located in the United States or abroad, are responsible for FCPA compliance and the procedures to ensure FCPA compliance. All managers and supervisory personnel are expected to monitor continued compliance with the FCPA to ensure compliance with the highest moral, ethical and professional standards of MRV.
USING THIRD-PARTY COPYRIGHTED MATERIAL
Employees may sometimes need to use third-party copyrighted material to perform their jobs. Before such third-party material may be used, appropriate authorization from the copyright holder must be obtained, with the exception of material for which the Company holds the copyright. The need for such permission may exist whether or not the end product containing third-party material is for personal use, for MRV internal or other use. It is against the Company's policy and it may be unlawful for any employee to copy, reproduce, scan, digitize, broadcast or modify third-party copyrighted materials when developing MRV products, promotional materials or written communications (such as manuals, presentations, etc.), unless written permission from the copyright holder has been obtained prior to the proposed use. Improper use could subject both MRV and the individuals involved to possible civil and criminal actions for copyright infringement. It is against our policy for employees to use our facilities for the purpose of making or distributing unauthorized copies of third-party copyrighted materials for personal use or for use by others.
EXPORT, RE-EXPORT AND TRANSFER POLICY
Design, Development and Production Technology. Export of design, development and production technology is subject to national security, foreign policy and anti-terrorism laws and regulations.
Employees must obtain written permission from the Chief Executive Officer or Chief Compliance Officer before providing design, development or production technology to nationals or territories of countries that have not ratified global weapon non-proliferation treaties. Non-Disclosure Agreements do not constitute written authorization to transfer design, development or production technology.
Technology that has been made publicly available, with the exception of cryptography, may be exported to all foreign nationals and territories except those embargoed or sanctioned by the United States.
Products and Technology. Under no circumstances shall employees or agents engage in marketing, service or sales of products or technology to embargoed or sanctioned territories without written authorization from the Chief Executive Officer or Chief Compliance Officer.
Violation and Suspicious Activities Reporting. Employees should contact the Chief Executive Officer or Chief Compliance Officer if they know or have reason to believe that any party (e.g. partners, users, employees, etc.) has or intends to violate United States or local country laws or regulations.
CUSTOMS COMPLIANCE FOR INTERNATIONAL SHIPPING
Our policy is to comply fully with customs laws, regulations and policies in all countries where we do business. Accurate customs information on shipping documents is required for all international shipments. Employees should not initiate shipping documents outside approved automated shipping systems or non-production shipping tool.
We have established guidelines for the collection, use and disclosure of personal data. All of our operations, activities and functions that collect, use, receive or distribute personal data must adhere to this policy. Moreover, all electronic and physical resources, whether owned or leased by MRV, and the messages, files, data, software or other information stored or transmitted on them are, and remain at all times, the property of MRV, and MRV reserves the right to inspect these items.
POLICY AGAINST RETALIATION
Employees, officers and directors may report suspected violations of this Code, suspected violations of any law, rule or regulation, any questionable accounting or auditing practices, and/or any other complaints or concerns openly or anonymously without fear of retaliation. Employees, officers and directors shall not discipline, discharge, demote, suspend, threaten, harass or in any other manner discriminate or retaliate against an employee, officer or director because he or she reports any such violation. However, if the report was made with knowledge that it was false, the Company may take appropriate disciplinary action up to and including termination.
DISSEMINATION AND AMENDMENT
This Code shall be distributed to each new employee, officer and director of the Company upon commencement of his or her employment or other relationship with the Company, and each employee, officer and director shall certify that he or she has received, read and understood the Code and has complied with its terms.
This Code is subject to change and may be amended, supplemented or superseded by one or more separate policies. The most current version of this Code can be found [under Company Documents in the Human Resources tab of mypaychex.com, and is also located] under the Corporate Governance tab on the Company's website.
This document is not an employment contract between the Company and any of its employees, officers or directors.